Bumpy ride today. There was a great reversal set up early this morning. I followed my plan, let it pass by. I almost gave back all the early gains(+$175) around 11:30. Last trade brought the day to a 3-digit profit level. But I missed the break out trade which took out previous YTDâs high.
I listened to Linda Raschkeâs seminar â5 Basic Patternsâ during lunch break. I am going to attach the PDF here for new traders. Besides discussing her indicators and patterns, she mentioned the importance of setting up tight stops. I guess I am very influenced by her presentation, plus wide stops are always my problems to ruin profit. So somehow, my stops were very tight through the day. The win rate comes down a lot, but the profit does increase than previous days. She also mentioned about only focus on basic patterns you are familiar with or even only trade one pattern you know can make you a living, I thought that was cool. But itâs hard to do for sure, you need to have huge âpatienceâ to wait for this very set up!
Todayâs trades were also influenced by the book I flipped through in Boarderâs yesterday. John Carterâs âMaster the tradeâ. There was this chapter about why most of people failed. The number 1 phase destined to fail is: get too positive, get too encouraged to win, win, win not lose. Conventional wisdom doesnât work in trading. You should only focus on loss/risk management, protecting your capital rather than think about the profit first. You should focus only on great trades, great strategies not the money to buy something luxury. You should also consider losing day is not a shame, itâs normal. Every loss is a winner. You can learn from it. ⦠Sounds easy but really its hard to do
Some people who have this Phase I problem, tend to move or remove their stops and think they can be rich quick or get even from the huge loss yesterday. Being stopped out can at least keep you in the game for a while, but one large loss can set you to fail and your full time trading career is over ⦠I kept reminding myself all these since last night. So today, I learned to focus on stop loss.
I also stop talking about trading with some of my friends and relatives. Because the first question they ask is always: how much money are you making now. They either think itâs gambling or think trading can make them a millionaire next day. For some reason, I feel some stomach sick every time I heard these types of comments and questions about trading. I always tell them trading is very difficult. Not a lot of people can make it at the end. Same as in every industrial, it takes at least 10,000 hour to learn. Tremendous ups and downs moment you have to deal with. I am not sure if I can make it at the end but I am trying my very best. I think only traders understand traders.
Anyways, I am not doing the best today, especially in last 2 hours, I got chopped⦠But I feel like my mindset has shifted to a right direction. I also didnât chase the market. I am happy with it. The hard part is to keep this same mindset.
TRADE A: Short
Entry:10135
Exit:10109
26Pts
TRADE B:Short
Entry:10132
Exit:10112
TRADE C: Long, out very quick.
Entry:10153
Exit: 10166
Todayâs PnL +$116.33% winrate
Weekly Recap:
PnL: +$491.80
Avg trades per day:9
Win rate:44%
Mistakes: 5
Cost of mistakes:$422.00
Comments: Still too many trades per day. NO move stops. Set up relatively tight stops. No chase the market. Wait for the best setup. Protect the capital. No counter-trend trading
